1. Field of the Invention
The invention is directed to addressing the needs of Medicare beneficiaries who cannot afford the prescription drug costs or treatments, but could by using a non-profit organization and/or non-profit pharmacy that can legally accept pharmaceutical drug donations that may replace hospital based drug products used for Medicare beneficiaries which are not normally covered under Medicare and/or satisfy TrOOP with Medicare Part D beneficiaries.
2. Related Art
Medicare is a health insurance program that covers people who either 65 years in age and over, or those who meet other special criteria. Medicare is a program that is administered by the United States government. Medicare has four basic benefit components. Part A is directed to hospital insurance and covers hospital stays and may pay for nursing home services as well if certain criteria are met. Part B is medical insurance coverage and helps pay for services and products which may not be covered under Part A. Medicare Part C is directed to various Medicare advantage plans where a patient will receive benefits through private health insurance plans. Medicare Part D is directed to prescription drug plans, whereas anyone who is eligible for Part A or Part B is also eligible for the Part D prescription drug plans.
Medicare does not pay for all the covered expenses or medical costs for a medical procedure for a patient under Medicare Parts B, for example only. Medicare requires the payment of premiums, deductibles, and co-pays. Additionally, Medicare under Part B may often not cover every procedure, every product, or the like.
The challenge often faced by Medicare recipients receiving care under Part B, is that often a medical procedure that is needed by the patient may be covered under Medicare Part B however, a drug product may be needed during the procedure that is not covered. Accordingly, some patients cannot afford the medical treatment even though the actual procedure is covered by Medicare because the patient cannot afford the drug product that is required by the procedure. For example, a Medicare patient may need a knee replacement. However, because he is a hemophilic, he also must receive the drug product factor concentrate in order to undergo the medical procedure. Accordingly, because Medicare Part B will cover the knee replacement, but not cover the expensive drug product factor concentrate, the Medicare patient cannot afford the procedure. Often a pharmaceutical manufacturer of drug product factor concentrate may be willing to “replace” the drug product in the hospital so the patient may receive this procedure. However, under Medicare law, such an act by the pharmaceutical manufacturer may be construed as an enticement or an inducement. Accordingly, the pharmaceutical manufacturer cannot legally provide the drug product to the Medicare patient in a hospital setting.
Treatment in the form of receiving prescription drug medications under Part D has a deductible associated with it that can be a financial barrier to needy patients. In this regard, the standard benefit under Part D is defined in terms of a benefit structure. For example, the standard benefit may require a deductible to be paid prior to coverage (such as a $250.00 in 2006). The patient then pays 25% of the cost of the covered prescription medication under Part D up to an initial coverage limit ($2,250.00 in 2006, now $2,400.00 in 2007). Once initial coverage limit has been reached by the patient's payment, the patient may be subject to another deductible referred to as the coverage gap but also referred to as a “doughnut hole.” Once the patient reaches the “donut hole,” the patient will have to continue to pay the full cost of the medication until the true out-of-pocket expense for the medication for that year including the deductible and co-insurance reaches a particular level ($3,600.00 in 2006, now $3,850.00 in 2007). Thereafter, the Medicare patient reaches catastrophic coverage in which the patient can then receive a reduced cost for generic and other prescription medication requiring only a small coinsurance percentage. The size of this donut hole is expected to increase annually as the overall price of drugs increases.
This donut hole obviously causes many patients financial hardship. Moreover, many patients discontinue therapy even after coverage resumes.
The only out-of-pocket costs that can typically count toward this catastrophic coverage are called true out-of-pocket (TrOOP) expenditures. The only time the patient can count the expenditures toward the TrOOP limitation is when the drugs are purchased in accordance with various government and other restrictions.
With respect to Part D of the Medicare Modernization Act, a common challenge for Medicare recipients is to afford the deductible and co-insurance TrOOP. Pharmaceutical manufacturers are currently petitioning the Office of the Inspector General (OIG) to allow their donated product to count toward meeting a Medicare patient's TrOOP. The OIG has in the past been against drug product donations by pharmaceutical manufacturers counting toward TrOOP, and has confirmed this with its last three rendered opinions in 2006. The OIG has allowed “cash” donations paid to non-profit organizations paying a Medicare patient's co-insurance to count toward satisfying TrOOP. However, the pharmaceutical manufacturers could not legally allow their free drug product donations to count toward TrOOP to benefit Medicare recipients.
Accordingly, there is a need for providing products to Medicare patients receiving Medicare Part B coverage. Moreover there is a need for Medicare patients receiving coverage under Part D to allow them to receive free drug product that will count toward their true out-of-pocket deductible.